REG - Trifast PLC - Trading Update & Notice of Half-year results

TrifastAnnouncement

20/10/2022 07:01

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RNS Number : 4765D  Trifast PLC  20 October 2022

 

Trifast plc

(Trifast, Group or Company)

 

leading international specialist in the design, engineering, manufacture, and
distribution

of high-quality industrial fastenings and Category 'C' components principally
to major global assembly industries

 

 

Trading Update

&

Notice of Half-yearly results

 

 

London, Thursday, 20 October 2022:  The Board of Trifast issues the following
unaudited update covering the Group's financial half year period ended 30
September 2022, ahead of the publication of its 2023 Half-year results.

Key points in HY1:

 

 Ø Group revenue ahead of comparable period c.£120m (H1FY22: £103.7m AER)
 Ø Continued mixed demand backdrop across our key end market sectors and
 international footprint

 Ø Additional contract wins in the period totalling £12m, reflecting market
 share gains and commercial focus on faster growing niches

 Ø Underlying operating profit impacted by inflationary pressures and pricing
 recovery lag
 Ø Stocks increased in short-term ensuring ongoing continuity of supply for
 new and existing business
 Ø General activity levels and opportunities provide confidence for the
 medium-term

 

Overview

The first half of the 2023 financial year has proved to be one of challenge
and opportunity against the global uncertainties surrounding industrial
markets.  As a Group, we have continued to experience a mixed demand picture
across our diversified end market and geographic footprint.  Whilst our
operations in Asia and US have produced a solid performance and slightly ahead
of expectations, we have experienced, as a result of weakened consumer demand,
a slowdown in particular within the Health & home sector in the UK and
Europe.  Volumes have improved across our other key markets with Light
vehicle and General industrial showing the strongest growth over the same
period last year, followed by the Distributors and Energy, tech &
infrastructure sectors.

 

We are focussing on both cost management and pricing actions to mitigate the
impact of ongoing, significant, inflationary cost increases.  This includes
ongoing pricing negotiations with a number of our key OEM customers.  In a
number of cases, these negotiations are taking an extended period to conclude
and so this activity will continue into the second half and consequently we
will not see a significant contribution from these until later in the
financial year.

 

We continue to make good progress on our strategic growth initiatives through
a mix of customer service, technical innovation, investment and capturing key
commercial opportunities.  New contract wins secured in the last financial
period are beginning to feed through and, in addition, we have secured during
H1FY23 a further £12m of contractual wins across our key sectors with the
largest uplift being in Light vehicle, all of which is very encouraging.

 

Given the commodity and supply chain challenges we have all faced in the last
few years, Group inventory levels have been held above pre-pandemic levels.
Inventory value has increased during the first half, reflecting a mix of
foreign exchange, commodity price increases, and the need not only to ensure
ongoing continuity of supply to our key global OEM customers, but also the
ability to service new contracts secured in the latter part of the last
financial year and the new wins mentioned above which have been and are coming
on stream over the course of the next few months.  Although inventories
remain above historic levels, we are working hard to reduce these over the
second half of the year.

 

Business outlook summary

With inflationary costs remaining elevated as a result of external factors
highlighted, we are focussed on initiative-taking steps to mitigate the impact
of these on our margins and profitability through a mix of operational
efficiencies and profit enhancements.

 

As set out at the time of our FY2022 results, we continue to believe that the
Group's FY2023 profitability will be weighted towards the second half of the
year.  Reflecting the continued commercial momentum the Board currently
expects FY2023 Group revenue to be slightly ahead of its previous
expectations.  However, given the short-term headwinds from the ongoing
inflationary pressures as well as some tactical growth investment, the Board
currently expect that the Group's underlying profitability for the year ending
31 March 2023 will be around 10% below current market consensus.*

 

As a Group, we continue to see significant scope to build the business and we
remain confident in the fundamentals of our business model over the medium
term once we see market confidence return for a sustained global economic
recovery.

 

Notice of Half-year results and presentations

The Group is scheduled to release its 2023 Half year report on Tuesday, 22
November 2022 at 07.00 hrs via the Regulatory News Service, and there will be
an analyst conference online at 9.15am GMT.

 

The Company will also hold a presentation via the Investor Meet Company
platform (IMC) on Thursday, 24 November 2022 at 11.30am GMT.  Investors who
follow Trifast on the IMC platform will automatically be invited to join the
session.  To register for the session, you may follow this link:

https://www.investormeetcompany.com/trifast-plc/register-investor
(https://www.investormeetcompany.com/trifast-plc/register-investor)

 

Both sessions will be hosted by CEO Mark Belton, and Interim CFO Andrew
Cooksey and  a recording of the presentation will be available on the
Company's website to view and download.

 

 

* Prior to this announcement Bloomberg-compiled consensus expectations for
adjusted profit before income tax and separately disclosed items, for the year
ending 31 March 2023 is £16.3m.

 

 

 Further enquiries please contact:
 Trifast plc
 Jonathan Shearman, Chair
 Mark Belton, Chief Executive Officer
 Christopher Morgan, Company Secretary

 Tel: +44 (0) 1825 747630
 Email: corporate.enquiries@trifast.com
 (mailto:corporate.enquiries@trifast.com)
 Shareholders: Companysecretariat@trifast.com
 (mailto:Companysecretariat@trifast.com)

 Peel Hunt LLP (Stockbroker & financial adviser)
 Mike Bell
 Tel: +44 (0) 20 7418 8900

 TooleyStreet Communications, (IR & media relations)
 Fiona Tooley
 Tel: +44 (0)7785 703523

 or Email:fiona@tooleystreet.com (mailto:fiona@tooleystreet.com)

 

 

 Editors' notes
 About Trifast plc

 "Innovation today for a better tomorrow - Growing sustainably, together"

 Trifast (TR) is a leading international specialist in the design, engineering,
 manufacture, and distribution of high-quality industrial fastenings and
 Category 'C' components principally to major global assembly industries.  We
 supply to c. 5,000 customers in c.75 countries across a wide range of
 industries, including Light vehicle, Heavy vehicle, Health & Home, Energy,
 Tech and Infrastructure (ET&I), General industrial and Distributors.  As
 a full-service provider to multinational OEMs and Tier 1 companies spanning
 several sectors, TR delivers comprehensive support to its customers from
 concept design through to technical engineering consultancy, manufacturing,
 supply management and global logistics.  The Group employs c.1,300 people
 across 34 business locations within the UK, Asia, Europe, and the USA
 including seven high-volume, high-quality, and cost-effective manufacturing
 sites and three technical & innovation centres across the world.

 For more information, visit:

 TRIFAST PLC TRI Stock | London Stock Exchange
 (https://www.londonstockexchange.com/stock/TRI/trifast-plc/company-page)

 Our website: www.trifast.com (http://www.trifast.com)

 LinkedIn: www.linkedin.com/company/tr-fastenings
 (http://www.linkedin.com/company/tr-fastenings)

 Twitter: www.twitter.com/trfastenings (http://www.twitter.com/trfastenings)

 Facebook: www.facebook.com/trfastenings (http://www.facebook.com/trfastenings)

 Note

 Trifast, TR and TR Fastenings are registered trademarks of the Company.

 LEI number: 213800WFIVE6RUK3CR22

 

This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is
disclosed in accordance with the Company's obligations under Article 17 of
MAR.  Upon the publication of this announcement via the Regulatory
Information Service, this inside information is now considered to be in the
public domain.

 

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